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WWL>Topics>>2-24-14 2:10pm Angela: on taxes

2-24-14 2:10pm Angela: on taxes

Feb 24, 2014|

Angela talks taxes with tax attorney John Butler.

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Automatically Generated Transcript (may not be 100% accurate)

-- were doing sort of a mental shift here from the very sad part of what's happened to cycle list. Who were beaten with a baseball bat and how we can be safer by simplest. And how our community can make things safer to. Okay so your entrepreneurial spirit is running high and you wanna start a business you've got the idea maybe even the location. But how do you still set yourself up. Or you've already started your dream business but have gotten a little behind in your taxes how do you handle that. We'll -- for the next hour John Butler a tax attorney with the law office of John Butler. And this is your chance to pick the brain of someone who has a great deal of knowledge on how to do this right. John it was nice not to be on our show last week on moment talk about federal taxes. And I just said oh my gosh. He is the answer to. For the many people I talked to say you know -- been an idea I'd like to start a business but they're not gonna go get an MBA they're not gonna go to business school how did they began. Sure so the the first thing to understand is is. You know a couple concepts and really and the first is when you say you know we're gonna start e-business. It's really important understand it did here in the US. -- business is a person. It's just like me it's just like Q and as legal right -- -- owe money to borrow money you can sue can be sued. So we talk about starting a business were really talking about creating an entity. Creating an identity. And when you see these the little letters by the end of names that a lot of people see like LLC in -- in Coke. We're gonna talk about what those are and how they work so. Basically. When you start a business to business is simply a bolt that holds things and that's the best way to think about LL season inks are things that hold things they can -- bank accounts. The original title to property taken on factories. You know but at the end of the day there's simply containers. LO -- Now we're gonna talk about the difference between the two -- and why it's really important to choose the correct one. But before we get there is a theoretical note. We're gonna talk about what's the advantage of this I mean why would someone spend 75 dollars go to the secretary of State's office and started now LC. And the reason why is because this allows you. You develop a product invest money make business deals with how risking. Your own assets in other words you know let's say on starting Butler court. You know I don't wanna take a chance -- I'm gonna be driving down I ten. And -- the Angela LC IO and get distracted and go off the road and and you know hit somebody and then someone's going to be able to take my house and you know my stuff. I don't wanna sign of business steel bar 300000 dollars total factory and BB you know have them take all my possessions so. The important thing about an LLC is that it it it creates a wall between you in the -- it's in your business. So that you can only basically lose what you put -- -- so if I started LLC and I contribute 50000 dollars cash. And it's something goes wrong and I lose. In doing air quotes lose 200000. The only thing the person suing -- and yet. Is -- 50000 I've put in why. Because the LOC itself is the defendant I'm now. So Butler LLC can see you -- -- -- sign contracts. Without me risking. My personal assets in and we do this to encourage economic growth you know an investor and aperture onto pro nor. Is much more likely to do to strike out on the zone and employ people and set up a factory if he doesn't have the risk to his own personal assets in doing that. -- now the problem with that of course is that you have to do it correctly. If you don't do it correctly then all of your personal assets are at risk. So. -- of course next question is how do you do this you know correctly and the way you do this correctly is it's through secretary of State's office -- you register. And LLC is the simplest easiest cleanest. Corporate entity in Louisiana. For every business out there that is not a specialty business and you probably know who you are if I say that you should be forming galaxies -- Inks are required in certain industries banks must be inks on insurance companies must be -- but unless you're really starting a big time venture. There's probably no reason for you to be in Yankee tickets and so you know we don't have time to go to specifics but it's a lot more bureaucracy within -- And LLC also allows you to have what's called passed through tax treatment which we're gonna talk about about half an hour yet. -- -- -- -- -- -- -- Often. I swear my route -- -- done city business you would see all of the incorporation in all there. -- season was sometimes -- the person's name sometimes it panic. You know bright sunshine in LLC -- So that is an individual. Setting up something would that -- just for some innocent you know what I wanna buy one ranch house. I'll make it an LC. Yes and and at its simplest level yes OK you know it's getting into properties a little more difficult because it's tax what's called schedule. You know that's a complex issue by. Basically let's take that example if you put that townhouse in the LLC write -- someone slip on the floor and let's say broke their knack. They couldn't get more than what's in that house race that's a perfect example so I am you know wealthy investor -- remaining cash in the bank. And I take 300000 out and buy a townhouse and now I'll see. The person who felt can't get more than 300 they can't touch the 1000007 I've still got my personal. Policy it's here or. In your home you know it could be I guess I mean it really analyses are forward for a business you know so so that that's not get -- -- -- a -- ability insulation that is the big protector of -- did that's the number one advantage of of any corporate Kennedy's liability insulation. There there's also numerous tax benefits to -- you know policy. Now a lot of people. And this is something I'm speaking directly to anyone listening who fits the following categories. That they on their own business their business has less than ten employees and they generate less than a million dollars a year. This is something -- done wrong. Probably five or six times a week yet and and let me explain please take a minute to explain because it's it's actually somewhat complex but basically. What we're talking about here. Is what's known as self employment tax okay and on this is the number one tax benefit of analyses avoiding self employment tax. So if you went to work with safer Exxon or any other company you get a paycheck and if you shook their hands and all work for fifty grand a year. You're -- you told him up all your paychecks it would be less than fifty in the reason why is his name withheld taxes from your paycheck. The way the IRS looks at people who are self employed. Is that they shouldn't get out of doing that just because their boss happens to be themselves. So let's say your tax rates 20% and you on your own business in your the only owner. You're not only have to pay your 20% based on your income you also have to pay fifteen point 8%. Based on the fact that you don't pay payroll tax as you work for yourself and that's all do at the end of the year. So self employment tax can functionally take your tax rate from the low twenties which is where most people are in the situation. 23540. And 45% if it's not set up right. Now the way to set this up correctly. Is. One another thing that the people sort of overlook is that when we talk analyses LCs -- state construct. You know you hear people talk about Nevada hello seized Delaware policies kinetic analyses Louisiana house. You don't hear anyone ever say I have a United States of America LLC and the reason why. Is his yellow sees what is known is that disregarded entity BI -- it literally does not exist. There's a secular registration step. You have to do you for your business. At the IRS after the state. That's the stat -- most people miss. With that step for 99% of people we're gonna go in a little more into the different categories. That step is known as an -- -- election now some people think as stands for smaller service that the -- It refers to the code section in the code section. And the the benefit of an escort. Is that it makes your LLC a person at the iris so before you register is an escort agency John Butler doing work. They say that your work your being paid for your work we're gonna take fifteen point 8% payroll tax you're being compensated for labor. Once you register as an escort. You still have to pay yourself solemn compensation for your labor pitcher working there full time. However you can pay yourself say a thousand a month 2000 month 3000 Revver reasonable salaries were -- dealing. And everything above that you can take as a corporate profit not as a paycheck. Which -- and tax and much lower rate. So instead of having John Butler earned 500000 dollars working and act pay fifteen point 8% and my regular taxes on that. They say John Butler and 50000 working for is registered LLC. And then the LLC has corporate tax on top which is much much cheaper. So that is the number one place where -- business owners lose money. Not making an -- election not registering yes and not doing it makes sense. Well for a -- -- that the good question I would say most likely because. A lot of a lot of people. When they start businesses. They don't. Consult an accountant you know on consulting an attorney as much as -- like their business obviously is not probably not necessary. By most people most accountants. And most people's relationship with their account -- get into this later we talked about trust but verify for businesses. Their relationship their town is is twice a year once they drop off the tax forms and twice and picked up the tax -- You know it's very important to people's -- down in and say you know how can -- Pay -- you know and and one thing I would say is be very wary of any profession tells you item -- of pay any thing. But if you do it right you can drastically reduce reduce your tax that. I want everyone to stay with this we're talking to John Butler of the law office of John Butler. If you have any questions give us a call 260187. I'm Angela on WW. Well we're talking about you've always dreamed about opening that business. Here's sort of the reality check and not just that that the help -- need. In setting it up correctly and for that we have John Butler again the law office of John Butler so. All right now we've set up an LLC. We've also gone to the -- and we have an escort. That's right and so now we're -- someone. And how we get to talk about two other happy topics which -- payroll tax. And sales tax and we were gonna go a little quickly through these. There's a few important things understand -- -- needed to to be aware of you know get in trouble on the -- you. The first thing to understand on the east -- taxes is they are by far. And if you listen and nothing else I sailors and this the worst taxes though. On the reason why is because they -- what is known -- trust fund taxes. A that's a term of art that refers to when a company takes money from someone else to remit to revenue agency. So in the case of sales tax for example the client. Is giving a circle K let's say a dollar for a Coke. The circle K collects a sales tax and then -- -- most people think of that. As circle K pay sales tax every month the most business owners think I have to pay sales tax. That's not exactly right the way the loss sees it is the unit the sales tax from your customers and you just give your customer you hold your customer's money for thirty days. Then send it into the state. Same thing with payroll tax you withhold the payroll tax for your employees' checks you actually pull it out. You're supposed to segregated and they sent it to the IRS wants a quarter once a month whatever your schedule is. The problem is that -- taxing agencies are incredibly harsh on people who don't do this. I suggest all my clients that they don't mess around with sales tax it's very tempting. To sort of skate on the sales tax cash flow and liquidity okay yeah he noted to say okay what my bank accounts 100000. You know the -- might be the eighteenth in the month sales tax or do the next day in that month and that money might not be you worse and it's very tempting to sort of skate on that and look at sales taxes of bill. Or payroll taxes of bill as opposed to something you're holding for someone else. You know. It's you know I tell you -- -- the only ways really the only ways aside from from fraud aside from line. One of the only ways to -- in criminal trouble in tax is through sales and payroll because you have an obligation to hold other people's money in and you know. And do a fair amount of white collar tax defense. And you know one of the most one of the by far most common. A type of cases is. The business owners on the payroll tax is just another debt that he could pay when he needed to. And that's not how the -- season the IRS sees it as you've taken this money from your employees. And you of the sacred duty to give it to us and then I've had IRS agents used the words sacred duty in you know. And you're supposed to pay that month you're supposed to pay well it depends you know the bill. The the bigger your payroll more often so if your payroll is less than 101000 a year. You only have to pay once a year and you file called for 944. If your payroll is off 4050000. You have to pay monthly. If you file what are known as 940 one's if your payroll is above 50000 a year then you have to pay biweekly. So you have to pay with a lot more frequency depending on and on how much. They all want to they all want your money not only that it's not your money you know that's the key to this is remembering. You know I've people complain to -- alana -- c'mon John I -- a -- and tax -- -- will you look for your employees right. He made a deal of his gentleman 50000 a year you paid him 46. And you're supposed to send afforded the IRS and that's it's really important for business owners to sort of get their head around that. Because. Long standing payroll and sales tax issues are. By far the hardest to fix -- not impossible but by their right for an artist to fix because of this issue be to put money for someone else. And they're also really the only type of tax debts -- where there's the Specter of criminal charges hanging over it because. You know the various revenue agencies look at it is that. I I strongly recommend everyone comes in my office that they did they -- to two things. The first is apparel company their companies out there ADP paychecks as a lot of national companies you know personally I send a lot of clients in net checks which is a local company in saint Mary parish. I semi bigger ties to ADP national company. They do all your calculations for you to make sure your found the -- forms they're very easy use you basically typing your employees in your. In their wages and the Internet it's all on line. And they file for you and it only costs the cost. 36 dollars a month for -- paid something like that is very cheap because would debut. -- staple attacks is that your account a couple days before their do you and they make money off the interest is they're holding your money for a few days. So that I have to charging high fees so there's no reason not be with a payroll service and it's it's a very good thank. I would also highly recommend the sales tax service you know -- are for all my clients for both -- -- -- tanning services unlimited in Metairie. I don't know the number you -- -- can be Google -- Brooke -- about a weight they've they've never let me down. They're very very good what they'll do is they'll actually put yourself right -- your bank statement in auto file and pay your sales tax for -- -- you never have to worry about it. And when we sort of set that up with. And accounts of it the sales tax never actually hit your talent that's what they'll do so that. You know you make a series of some was something for thirty dollars -- small business they pay you 33 total right -- nine points -- 5% sales tax. It'll put the 31 account in the three in the other so that you're not fooled -- the only your bank account and think -- -- -- -- 100000 in -- -- -- -- -- -- in the -- the next -- So it's really important in my opinion to -- services to keep desegregated. Is the last thing you want is any allegation of you putting. Either employees money in your pocket he took out of their paychecks or putting sales tax in your pocket that you charge she -- hasn't been your X. Those who got into trouble. Sort of dipped in to those tax -- -- -- on financially absolutely you know typically payroll that's that's a 100% was salesman with sales. That is basically what happens is they look at -- sales tax debt. They think you know Edward talked later about why it's important file returns and he -- -- him or not. But worried you know they look at the the money and they say I can't pay the sales tax right now I'd rather pay my employees in the government and that's what they do. On the payroll tax side and when we come back we'll talk about this. On the payroll tax side did did they get in trouble by borrowing from and number one and number two. Calling people independent contractors who were really employees that's -- my really bad case is let's talk about that a -- independent contractor. So a lot of business is -- to -- they can determine. How they're the people who work for them are classified in other words in an auto body shop would say -- form mechanics. They aviation mechanics on a contract -- as you're an independent contractor. I'll pay you twelve dollars an hour and pocketing any taxes out your taxes your responsibility the employer signs the employee signs in the -- things great. Right that's where it up payroll tax and a contractor. Unfortunately that's not how it works the losses that. The whether or not an employer an independent contractor. Has absolutely nothing to do with what the employee in the employer agree. There's a five part test to test whether or not there an employee or contractor and if they pass the test their contractors that they failed -- -- employee. Making it even more confusing there -- three payroll tax authorities in Louisiana. The Louisiana workers compensation committee the Louisiana State and the feds all three have different definitions for employee. So which is to be very confusing and you have to -- offering so it's really important if you want to hire contractors to see a professional and make sure you pass the test. If for example even hiring contractors for the last five years. And the IRS audit -- says no no they're not contractor's employees. They're gonna come after you for all the payroll tax all the checks you've written those contractors from day one. There is a case we we -- a bit about this that the break there is -- -- case called the United States feed rate suede is a very recent cases it's 20112010. Out of the fifth circuit. And what it says is that you cannot charge. Our business is payroll tax you any good faith belief they were paying independent contractors properly -- health and here's where a lot of my clients fail. If the client did everything right. In issuing the ten agonizing issuing independent contractor reports so if you do it perfectly. You don't have to pay back tax however where you're not allowed to do is not do it right and then say they're contractors not payroll you're getting its land. So you gotta make sure you're either doing it has contractors exactly right to hide under briefly safe harbor. Or you have to just get on the payroll service and don't mess around which would be my eyes and they consented to prison for that well not not necessarily for that -- mean they can basically that this there's no such -- -- debtors prisons he cannot go to jail for not paying your taxes that's a myth. Who as that thing you can go to jail for is two things from one now filing returns. I hear all the times in my case is John I -- file because I couldn't pay so why file well. You file because the losses you have to and they say it's not filing is a crime. So no matter why it doesn't matter if you don't have the money. -- -- Purity and number -- they can send you to jail for a line. Now there is a statute that allows the feds to prosecute you for taking the payroll of your employees. I have never personally seen used it does exist. But the only times I've ever had a case of criminal are aware my client. Was less than honest on the tax returns or didn't file them it's almost impossible to go to jail for not paying money. Well very very important let's take a break let's go to the newsroom and Don names will be right back but we are talking about so you wanna set up your own business. All the things you need to know that can combat can help you. That cannot keep you honest and never have to worry about the IRS and just to do it right. We're talking with John Butler who was say a tax lawyer and we have a caller -- from New Orleans -- Hi. That my daughter live in right next door to me and the agreement is that they elite players and taxes. I don't collecting rent an appetite to granddaughter right next door to me. And I made it into an Al Al -- intake -- -- let them all at a bit between them. I'm not it's cute -- I and they are -- at all. Well I think I think that you know that the problem with that is that residential real estate follows different rules. On you know the problem with that is that you could make it in dance. Yet few fit to test for what is known as a full time real estate professional. The IRS is worried and and justifiably so actually exactly where you're suggesting was an incredibly popular tax shelter in the eighties. Where people would get houses they would put him analyses they would make him escorts and and they distribute was called depreciation deductions to themselves sauce at their salaries. The problem with that is the IRS in response that passed a rule that said in order feud -- -- escort tax treatment for a LLC that only does real estate business. You have to pass a test where. You either spend 700 hours a year in real estate or real estate as your primary source of income. If you pass either of those tests then you wanted to and then an escort would probably save you money. However since they're not paying you -- you shouldn't be paying tax on it anyway so. Most likely. It's a non issue for you if they were paying you -- and it was your only source having come then it would probably work. The only thing that they. I mean detected that there like property tax churn it and -- like that. Right so the only thing you need to watch out for here. And again it's we feel very small amount of money. Is that. Unless you've got to written least theoretically they ought to use -- called against NC you have to keep. Of expense for the repairs and the property tax under a total third thirteen thousand dollars a year. Other than that I think what you have now is is not is not taxable at all. Sure okay thank you for calling. Let's talk about how we solely. -- -- -- Sure so what what they don't wanna jump jump back to really quick that I didn't say is that. When I say contractor what I'm talking about -- individual humans you know if you go out you hire. You know a company to beer accounted you do your books it's accompany you never have to worry about payroll tax. So and as a contractor what I mean is you know I gave Joey check I gave Bob checked that's that's what I'm talking about there. So let's talk about how lively attacked from the the the number one thing understand about avoiding attacks problem is -- we presently live. In what was recently ranked in the worst state in the union for audits. We have -- by far the strictest record keeping requirements and we have by far the worst appeal process. On this is in the and he's there are about three weeks ago. On so if the first and understand about how to avoid tax problem is that Louisiana is one of the few states along with Florida and Mississippi. That assume that if you don't have the records you -- the tax so what that means is it's a sales tax auditor comes to audit you. And you can't prove that let's say let's say you put it that you spent. 500 dollars on -- given month you don't have a receipt. They're gonna charge you -- tax on that ran. The weak yen and audit the burden is 110%. On you. Every record must be kept. So it's very important have records of the following for Enron a Louisiana business. Daily sales expenses and all tax returns those are what we call the Big Three so any time your business spends money -- Seton keep it. Anytime your business takes in money have a record the records are required to be by day. That may mean for some businesses you have a lot of days it has -- there's nothing wrong with that. But Louisiana requirements are by day. -- They know. Sales. -- good question there's any number of ways they can try to figure out this is a little bit a field but it. The auditors if you cannot produce the records to have to their satisfaction. There are empowered to approximate your income using any number of met -- now. There are four methods. By which the auditors can approximate your income. So for example in the liquor cases the fifth circuit he said the proper things to do is to go to the vendors so all the liquor vendors in the city. You get the amount of inventory they purchased. The general rule is bars sell everything but he point 1% of their inventory so that'll tell them exactly how much -- you sold quote unquote. They then get your prices from your establishment they multiply it and that gives them the sales so if you don't have records that's what they do. So you know if a truck got lawsuits he ordered a shipment they canceled it depressing you know whoever did -- -- is doesn't have record your cancellation. You know you're paying tax on it so there's any number of ways and actually have a case right now the CDC loyal appoint jurists. Where this CD is attempting to establish a -- new way to approximating come. So it's it's it's pretty interesting. So in the absence of your record keeping requirements there any number of ways you know one other ways of the media aim at these bank deposit analysis. Where they basically get your bank statements and say all your deposits are sales. That I can really hurt people who for example borrow money that they borrowed 200000 that looks like a sale to bank deposit. So if you're records -- in order they opened up the door to the auditors. You know coming in and and and basically telling you what you while. The other problem that people have in Louisiana about audits and about if they don't keep good records. The -- easy and as one of the only states in the union and I Florida's like this but I don't know any others that are. Where in order in -- whereabouts -- say everyone always looks to me like at five heads that this is the law. In order to protest the sales tax assessment in Louisiana and audit you have to pay it first if you don't pay you can't fight. That's the what the -- says now a very similar actually give money back if you proven right that's correct. So basically they do way the system works and retirement this morning minute we talk about deadlines. His face and you'll notice that tells you what they proposed U low that there is a proposed assessment. You're -- send it certified. You're thirty days from the receipt of that to file a notice with the Louisiana border tax appeals or to send a letter back to the auditor telling them why they're wrong. -- keep in mind the judge to Louisiana to border tax appeals works for the state farm revenue. And the auditors sending a letter Tuesday auditor who just said you owed X amount. If neither of them reverse the decision -- the water on the amount -- the sensuous known as the final notice of assessment. From the receipt of the file notice of assessment you have thirty days to go to court to file a petition hire a lawyer and go to court. The judge will decide. Whether how much of the money you have to put up in cash and how much you can put up in property to for example if you let's say they -- CU -- 200000 sales tax you could put your house opens the bonds you know it doesn't have to be -- But it has to be secured. If -- -- you notice saying you'll million dollars and you can't come up with a million dollars you oh million dollars. Now there was a very similar system in Hawaii that was struck down as unconstitutional. And violates equal protection clause. This the Louisiana. Sort of -- scheme has not been challenged it's never been challenge for its constitutionality. So we will see I mean who knows what might happen we become the toughest. I don't really now -- to be honest -- you know. -- in this way since I started practicing this type a lot of seven years ago com. But basically. You either need to have a bond for the full amount or you need to pay the full amount. In order to challenge and if you can't then the amount is -- -- -- -- picture just changing it to a smaller situation. Somebody has -- consulting firm there of the consultant and ultimately. There until it isn't saying deal. -- an item share it's me whatever. So let me so let me talk about that for a minute details you don't -- -- here's how the sales tax works and how we decide if we need to charge sales tax. The first question to ask is whether or not there has been a sale of tangible -- and personal to property three. Those -- the three checkbox is a pretty sales tax. A sale of tangible personal property tangible means we can touch it so selling -- trademark might be property might be personal but it's not tangible. The selling trademark. Doesn't apply. It has -- personal now that's an older term that basically means not realistic. So we can't be property okay. And then the last the last of course is it is property. Some states say that the property has to be movable IE transportable in order to charge sales thanks we don't have that rule. So the first thing to ask -- is due I have a piece of tangible personal property being sold. If you do it again. I hate you know he's been talking bad about Louisiana but again we have very archaic sales tax code. And the way our sales tax code works is everything is sales taxed on last year on the exemption list there's a list in the statute of products. Oil being one of them who does not charge sales tax so where you're not required to charging like sales tax. There are a lot of products for example they have special sales taxes. So the only way to know for sure is to go read it department revenue web site for example as your cellphone storage had a case with this. There is an extra ten cent per phone sales tax for 911 tax but most cellphone stores don't know that if they ever get audited. -- pay ten cents for every phone universal. You know there's -- there's an exemption -- just got passed for arts and crafts are Democrats are now no longer subject to sales tax. So it's it's constantly changing in the only way to knows -- list out that's why you don't refer them again accounting services unlimited. I strongly recommend you hire them or another sales tax service because they stay up to date on all the rules that make sure it's done right. And I sent them problem -- of hundreds of clients last five years -- -- -- very good job so. I would say higher tariffs or is -- limited or -- it's a prior to check every. We're not finished talking to John Butler financial under the that -- will. We're talking with John Butler about setting up the business and Bob is calling with questions on. I am that's been punitive and Arlen Specter out -- that beat in another state. -- that propagated. It is good that Arafat for -- let me that you should have been reading. Absolutely. Because the full faith and credit clause it does not matter which state you incorporate your LC and the only thing I would caution you -- is that you will have to root any Louisiana I'll see that wants you business and other state has to register in that state. To very quick process through that state secretary of state. What what state is in the property. Of Casey wanna go to the Alabama secretary of state website it's really easy to do it on line of the credit card. You're gonna wanna go to Louisiana secretaries they website get what's called your charter number which is how you identify your company. And then you go to the Alabama secretary of state and you register to do business and Al -- the cost fifteen dollars and then you can do anything you want Alabama's if you were in Louisiana. That's great thank you for calling. Very quickly in our final minutes about them. How to fix back tax problem shares so so one thing I really wanna say and then this is sort of directed. Of people out there who have been getting notices and don't know what to do and you know this is really my area I mean you don't need a -- to set up and I'll see you know accounting services unlimited can do that for -- great. You know -- what I do is is back tax -- you know people -- large amounts of money and we need to settle and litigated. And the -- thing that I will tell you his tax problems are not a fine line they do not you -- age these things get much much worse and as long as you are the one reaching out to the IRS. It's. Very unlikely you're gonna have a bad outcome and I mean incredibly unlikely I've never seen and I've never seen it where taxpayers the IRS and says. Listen I've got issues in getting these notices I've got problems I knew you returns in the IRS says. You know get in the box that almost never happens the place for people get into problems is they put it off they put it off and put it off and put it off and put it off. And then the agent. Knocks on the door and he sized up the car for sale and he's asking -- PM your -- he's not gonna wanna hear about a payment plan and I 85 months paperwork together you know so it's. Infinitely easier and I can't even tell you how much easier it is. When you go to the IRS and say hey can we deal with this as -- when the IRS forcibly comes to you. And believe in and they will come eventually. So the the other thing I wanted to point out two things before we break. First is. There are incredibly tight time lines to contest issues raised by the taxing authorities most people get letters from the IRS states city put him in a drawer and don't think about it. The iris is due ninety days to contest the state thirty the city sixty that's it once those deadline run its -- So don't trust your accountant call the IRS because once those deadlines go that's the end you can never bring it up again you on the money. John Butler you are incredible this has been fascinating we're gonna get to back everybody stay with this will be right back. And we're back talking to John Butler final thoughts trust but -- But thanks episode so mean and I'm I mean this I say 99% of my clients with -- bad tax problems. Trusted their accountant to deal with the problem before it got to -- And basically what that would happen is. The IRS to be sending notices and these people be -- their calendar and saying hey. I'm getting these notices you know help me -- them and the I had the talent -- fine everything's fine everything's fine. That happens in nine -- and in my case is so called the CPA afford to make sure you're CPAs actually CPA number one. Number to call the IRS and make sure you're in compliance it takes thirty seconds. Double check your CPA trust him but verify everything he does John Butler thank you. Thank you for everything stay with everyone we talk for the next hour with general honorary.

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